Dividend blow from Homestyle

HOMESTYLE cut its dividend today as it plunged nearly £11m into the red after a dismal summer for its Harveys furniture arm.

Investors will miss out on an interim payout after Harveys took a battering from cut-throat competition in the home furnishings market. But chief executive Michael Rosenblatt said the worst was now over and shareholders would get a full-year payout.

The shares fell 7p to 127 1/2p and Numis Securities is shaving its full-year profits target by £2m to £14m.

Pre-tax losses for the six months to 1 November were £10.5m against profits of £1.4m a year ago and below City expectations.

Homestyle has revamped Harveys since the summer and Rosenblatt said he was encouraged by a 6% pick-up in like-for-like sales in recent weeks. 'We are very hopeful that we have turned round the business,' he said.

Sales are up 13% in Homestyle's beds business, which includes Benson Beds and Bed Shed.